Telecoms costs ‘beyond the pale’ for multinationals

19 May 2006

Multinationals operating in regional areas of Ireland are spending more money getting their telecoms traffic back to Dublin than they do to the US, a senior telecoms executive has claimed.

The director of business services at telecoms provider Magnet Business Donal Hanrahan (pictured) said that multinational companies located outside Dublin are being overcharged for telecoms and others are shunning the regions altogether because of exorbitant telecoms charges.

“There are a number of good reasons why a business should locate outside of Dublin but one of the big drawbacks is the high cost of telecoms backhaul to Dublin and onwards to international markets,” Hanrahan said.

“With an increasing number of global companies coming from internet-related industries, this could become an increasingly significant barrier to companies setting up in the regions.

“Companies located in Dublin have benefited from the relatively competitive environment there and they can connect to international markets at reasonably affordable rates but if you’re in regional locations such as Limerick, Galway, Waterford, Portlaoise or Cork you’ve got to get to Dublin to get those prices and that’s where you get penalised by the incumbent operators,” said Hanrahan.

Hanrahan’s comments come as Magnet Business launches its international offering, providing affordable connectivity from Limerick, Cork, Galway, Waterford and Portlaoise to the US, UK and Canada.

“By combining Magnet’s high-speed national network with the transatlantic fibre network of our sister company, Hibernia Atlantic, we are now able to provide annual cost savings of up to 50pc for companies with data connections to the UK, US or Canada,” he said.

Hanrahan added: “In the past number of years all the large internet companies such as eBay, Amazon and Google have selected Dublin as their European headquarters. These companies are completely reliant on low-cost, high-capacity connectivity and as far as they’re concerned it is just not affordable in the regions. We hope to do our part to redress the imbalance.”